We heard about a surprisingly weak British economy this morning and expect to get reports on the U.S. housing and consumer confidence. But our focus will remain on fourth-quarter earnings.
We had a lot of earnings reports this morning. Most of the reports are positive, but there are a few notable exceptions as well.
Among the earnings misses, Verizon and American Express came up short of expectations. Texas Instruments, on the other hand, beat EPS and revenue expectations, but its new orders slipped and industry-wide inventories may be on the rise.
On the positive side, DuPont beat EPS and revenue expectations and raised guidance. Baker Hughes also beat on both EPS and revenue.
On the economic front, we have the S&P/Case-Schiller Index for November expected to show another price decline. But continued housing weakness is hardly news at this stage, particularly if the ‘news’ is on the stale side. Please don’t forget that the November Case-Schiller Index would be an average of the three months to November.
We expect to see a modest improvement in the Conference Board’s Consumer Confidence Index today as well, but the more consequential economic news of the day will be the surprisingly weak showing by the British economy. We heard this morning that the British GDP surprisingly contracted in the fourth quarter of 2010. The chilly weather in December apparently had a dampening effect on economic activities.
Sheraz Mian
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